Posted on 02/05/2007 11:05:36 AM PST by MNJohnnie
Are Credit Checks Racist?
Studies haven't found a link between poor credit and job performance, but more employers are checking, and minorities are getting squeezed. Insurers are slammed for checking, too.
By Christian Science Monitor
Lisa Bailey worked for five months at Harvard University as a temp entering donations into a database. When the university made the job a salaried position, Bailey, who is black, saw a chance to lift herself out of dead-end jobs.
Bailey's superiors encouraged her to apply, she says, but turned her down after discovering her bad credit history.
Bailey, with her lawyer, has lodged a complaint against Harvard charging racial discrimination. The reason: Studies indicate that minorities are more likely to have bad credit, but credit problems have not been shown to negatively affect job performance.
Some privacy and minority advocates are now seeing credit as a civil-rights issue as minorities start to fight employers and insurers who base decisions on credit histories. Their effort could slow the near doubling in credit checks by employers in the past decade, which affects millions of Americans who are struggling with debt.
"It's definitely a civil-rights issue because of the growing use of credit reports and credit scores for hiring, renting an apartment, insurance and the fact that people of color have not been integrated into the credit-scoring system as much as traditional white middle-class America," says Evan Hendricks, the author of "Credit Scores & Credit Reports: How the System Really Works, What You Can Do."
(Excerpt) Read more at articles.moneycentral.msn.com ...
The usual suspects will say that a bad credit report shows that a person has a poor sense of responsibility. These people have obviously never had a long term health problem or a long term layoff.
What was her credit score I wonder? 12?
I own a couple of rental units. When potential renters apply I have a credit check run on them. If they have a history of not paying their rent, I won't rent to them. I don't run a welfare office, I'm in it for the money. Not based on race, it's based on the ability/willingness to pay on time and meet their contractual promise to me.
Credit checks for a job are BS in my opinion, but they are BS for everyone, not just the minorities. If you're going to buy something, credit checks make sense. Again, my opinion.
End financial profiling now!
amen..
I know a HR guy and he told me that the company he works for won't even consider an applicant if their credit score is below 700..
LOL!! Good one! I like it.
Hey ACLU credit checks are financial profiling get rid of Experian and all the credit agencies.
Or identity theft or wrong information on credit files. Try dealing with the credit bureaus on these issues---sheesh.
The auto insurance does the same thing. They figure that people with bad credit have higher accident rates.
Take a 700 score and then "shop around" for a home loan ... voila ... the inquiries just put that 700 score way into the 600's
Maybe a credit check is a poor way to judge someone, but it's not racist.
No more racist than checking someone's criminal record.
An applicant with a long criminal history could claim that it's racist to check criminal records because "studies indicate that minorities are more likely to have a criminal record."
But that would be a crock too.
I think it is very common in any industry or jobs that require processing money funds, to require credit checks. It is responsible for the employer to know if the person handling their customers' financial transactions has had credit problems. Bad credit issues can indicate a person who is more at risk of temptation in misappropriating the customers' funds. Banks, insurance companies, any firms that deal with stocks, mutual funds, etc., require the credit check process in evaluating applicants.
Or a lawsuit:
http://www.freerepublic.com/focus/f-chat/1776804/posts
While I think employers have every right to ask whatever kinds of questions they want to ask, I also don't think that credit checks are reasonable requirements for most jobs. If she were handling a large amount of cash, or she were going to have the authority to spend significant company money without supervision, then it would make sense. But for a temp-to-hire data entry position, it seems utterly unnecessary.
Mind you, I don't think this is racism, just poor corporate policy.
yupper..people say to shop around, but the problem is inquiries will LOWER the score significantly..so, you may start off fine, but then you either get turned down or the rates go up..and it's because your 700 score is now 680 based on the "shopping" the "professionals" tell you to do..
what will also lower the score is not only the balance on credit cards, but also frequency of use..
Even worse, is how credit card companies are using "universal default" to jack up interest rates on existing debt balances to over 30 percent! (Chase is notorious for this - one of the worst.) They periodically check your credit, and even if you have never made a late payment, if there is a traffic ticket or a late payment on some other unrelated account, they jack up your interest to usurious rates. They got the green light to do that after Congress tightened up the bankruptcy laws recently. And, it's completely legal.
If you dont like this you will positively
LOATHE
the real ID compliant drivers licenses..< thanks big brother>
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